FEDERAL ELECTION COMMISSION 

WASHINGTON, D.C. 20463 

BEFORE THE FEDERAL ELECTION COMMISSION 

) 

In the Matters of ) 

Commission on Hope, Growth & > ^UR 6391 & MUR 6471 

Opportunity 

STATEMENT OF REASONS 

OF CHAIR ANN M. RAVEL AND COMMISSIONER ELLEN L. WEINTRAUB 

The Commission on Hope, Growth & Opportunity (CHGO) spent millions of dollars to 

influence the 2010 federal elections. Yet CHGO failed to disclose a single dollar of that 

spending or a single donor to the public. This organization so blatantly disregarded disclosure 

requirements that the Commission unanimously found reason to believe that CHGO violated the 

Act's disclosure provision and authorized a rare investigation into CHGO's spending on its 

advertisements that clearly opposed federal candidates or explicitly advocated against their 

election.' Through this investigation, the Office of General Counsel (OGC) determined that at 

least 85 percent of the money CHGO spent in 2010—about $4.77 million—^was spent on these 

advertisements.^ However, despite this overwhelming evidence, our colleagues could not be 

persuaded to conclude that this organization was a political committee, required to register with 

the Commission arid report its contributors and spending.^ 

The Commission's failure to enforce the law against groups, like CHGO, that are 

political committees deprives the public of information that would allow them to evaluate 

political speakers and their messages.'^ The law requires a political committee to register and file 

regular disclosure reports with the Commission.^ Instead of reporting only the amounts spent on 

individual communications, such as independent expenditures and electioneering 

' See Certification in MUR 6391 & 6471 (Commission on Hope, Growth & Opportunity), dated September 16,2014 

("First Genera! Counsel's Report Certification"). 

^ Third General Counsel's Report in MURs 6391 & 6471 (Commission on Hope, Growth & Opportunity), dated 

September 24,2015 ("Third General Counsel's Report"), at 18. 

' See Certification in MUR 6391 & 6471 (Commission on Hope, Growth & Opportunity), dated October 1,2015 

("Third General Counsel's Report Certification"). The Commission deadlocked 3-3. 

" See Citizens United v. FEQ 558 U.S. 310,371 (2010). 

'5ee 52 U.S.C. §§ 30102-104. 
MURs 6391 & 6471 (Commission on Hope, Growth & Opportunity) 

Statement of Chair Ravel and Commissioner Weintraub 

communications, political committees are required to disclose all of their receipts and 

disbursements and all relevant contributor information.® 

This is not a difficult case. It was evident at every stage of the Commission's 

proceedings that CHGO, a dark money group, was a political committee. In fact, we voted to 

approve OGC's initial recommendation to find reason to believe that CHGO was a political 

committee over a year ago because the information available then clearly showed that CHGO 

spent the vast majority of its money on advertisements that clearly supported or opposed federal 

candidates.' Our colleagues were not similarly convinced, so we agreed to investigate CHGO's 

disclosure violations and took no action at the time with respect to its political committee status.® 

When OGC came back to the Commission with even more information about CHGO's 

objectives and spending, this only reinforced our previous determination that CHGO was 

undoubtedly a political committee. For example, we now know how CHGO explained its goals 

to potential supporters and donors. According to its internal documents, CHGO sought to make 

"a measurable impact on the election outcome in selectively identified Senate races."' A 

consultant writing to a potential donor described CHGO as "an organization which focuses on 

running independent expenditure campaigns in key districts to support the election of Republican 

candidates." 

CHGO stated in both its Articles of Incorporation and in response to the FEC's 

investigation that its organizational purpose was to educate the public on economic policy.'' But 

this story simply does not hold up if you look at the ads that CHGO ran, keeping in mind that 

running advertisements was close to the sole focus of the organization. 

For example, the script for one version of an ad aired in Colorado's third congressional 

district provides: 

"John Salazar says he's an independent voice. But he voted for the Pelosi agenda an 

astounding 97% of the time. Salazar squandered billions on a bogus stimulus bill as 

unemployment skyrocketed. And Salazar led the charge with Pelosi for Obamacare, 

further crippling rural Colorado's economy. As a local business owner, Scott Tipton 

believes Coloradans know best how to create jobs and grow our economy. Help Scott 

® Compare 52 U.S.C. § 30104(b), mth 52 U.S.C. § 30104(c) and (0-

' First General Counsel's Report Certification. When the First General Counsel's Report circulated to the 

Commission in December 2013, we approved OGC's recommendations, six months before the matter was placed on 

an agenda for consideration and nearly nine months before the Commission finally authorized an investigation. 

' First General Counsel's Report Certification. 

' Second General Counsel's Report in MURs 6391 & 6471 (Commission on Hope, Growth and Opportunity), dated 

July 28, 2015 ("Second General Counsel's Report"), at 12. 

"Id at 11. 

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MURs 6391 & 6471 (Commission on Hope, Growth & Opportunity) 

Statement of Chair Ravel and Commissioner Weintraub 

"12 Tipton make America work again. 

Many of CHGO's ads contained language that can only be reasonably interpreted as a 

call to vote for or against a particular candidate. And all of the ads supported or opposed 

particular candidates in the upcoming election. In fact, almost all of CHGO's spending was 

related to the production and dissemination of these ads. 

Despite this information, uncovered in the initial investigation, our colleagues still did not 

agree that CHGO was a political committee and strongly suggested that OGC gather more 

evidence about the itemization of CHGO's 2010 media spending. As directed, OGC uncovered 

even more information about CHGO's spending, including at least $2.9 million on independent 

expenditures and at least $1.1 million on electioneering communications. Yet despite this 

additional information about CHGO's overwhelmingly political spending, three Commissioners 

again found the evidence to be insufficient to show that CHGO violated the law, and the 

Commission ultimately deadlocked 3-3. 

The principal legal issue here is whether CHGO has the "major purpose" of influencing 

the election of federal candidates—^the critical piece of the political committee status test.'" If it 

seems like a no-brainer, that's because it is. A group, like CHGO, that (I) has documents stating 

that its goal is to influence elections; and (2) spends the overwhelming majority of its funds 

running ads supporting some candidates and opposing others, is a political committee. 

Three of our colleagues have gone to great lengths to avoid enforcing the law against 

dark money groups like CHGO. As we've mentioned in prior statements,'^ they have made a 

5ee First General Counsel's Report in MURs 6391 & 6471 (Commission on Hope, Growth & Opportunity), dated 

December 26,2013, at 10. 

" Third General Counsel's Report Certification. 

Any organization or "group of persons" that satisfies the test for political committee status must register and file 

periodic reports with the Commission, disclosing its contributors and spending. The first part of the test, set forth in 

the Act, requires that the entity make more than $ 1,000 in political expenditures or receive more than $ 1,000 in 

contributions during a calendar year. 52 U.S.C. § 30101(4)(A). The second part of the test, added by the Court in 

its Buckley v. Valeo decision, requires that the organization have as its "major purpose ... the nomination or election 

of a candidate." 424 U.S. I, 79 (1976) {per curiam). 

In 2007, the Commission approved, by a bipartisan vote, a detailed Supplemental Explanation and Justification 

providing guidance to the public regarding the "major purpose" requirement of the political committee status test. 

See Political Committee Status, 72 Fed. Reg. 5595, 5596-7 (Feb. 7, 2007) (Supplemental Explanation and 

Justification) ("2007 E&J"), available at httD://sers.fec.gov/fosers/shovyDdf.htm?docid=34789. The 2007 E&J 

includes a list of examples of activities that indicate that an entity meets the "major purpose" test, such as: "direct 

mail attacking or expressly advocating the defeat of a Presidential candidate," "television advertising opposing a 

Federal candidate," and "other spending... for public communications mentioning Federal candidates." Id. at 

5605. 

" See Statement of Reasons of Vice Chair Ravel, Commissioner Walther, and Commissioner Weintraub in MURs 

6538 (American for Job Security) and 6589 (American Action Network), dated July 30,2014, available at 

http://eQS.fec.gOv/eQsdocsMUR/14044362039.Ddf: Statement of Reasons of Vice Chair Ravel, Commissioner 

Walther, and Commissioner Weintraub in MUR 6396 (Crossroads Grassroots Political Strategies), dated Jan. 10, 

2014, available at httD://eQs.fec.gov/eQsdocsMUR/14044350964.Ddf. 

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MURs 6391 & 6471 (Commission on Hope, Growth & Opportunity) 

Statement of Chair Ravel and Commissioner Weintraub 

series of unfounded arguments for why groups like CHGO don't meet the "major purpose" test. 

Our colleagues will not count any advertisement towards major purpose unless that 

advertisement expressly advocates for a candidate—even advertisements that attack a 

candidate's record and praise the opponent's, in the candidate's jurisdiction, right before the 

election. Unless an advertisement has "magic words" (e.g., "vote for Smith"), our colleagues 

will generally not consider it to be express advocacy, regardless of the content.'® And even if an 

organization does run those "Vote for Smith" ads, they will not find the organization to have met 

the major purpose test unless over 50% of the organization's total spending was for those ads— 

even if the bulk of the organization's other spending is on office space, salaries, and 

administrative costs solely to enable staff members to work on ads. 

In other words, under our colleagues' analysis, it's entirely possible for a group to devote 

all of its resources to supporting or opposing federal candidates, but still not be a political 

committee, as long as they keep up some minimal fa9ade asserting that they are an issue-oriented 

group. 

In this case, even if evaluated under our colleagues' own theory, CHGO spent 61 percent 

of the over $4.8 million total it spent over its organizational lifetime on express advocacy 

communications." While we disagree strongly with this limited framework for determining 

political committee status, this fact alone should have been sufficient to conclude that CHGO 

violated the law. 

The same types of manipulations abound when it comes to evaluating evidence. Our 

colleagues accept, at face value, blanket assertions that groups are concerned about "issues." 

And they obviously have not drawn any negative inferences from the fact that CHGO was not 

only uncooperative with our Office of General Counsel, but kept almost no records despite being 

told to do so at the beginning of these proceedings,'* and made almost no attempt to comply with 

campaign finance rules. It apparently bears little significance that CHGO leaders decided to 

close up shop "most quickly" because of the pending Commission matter, leaving our lawyers 

and investigators to piece together records from television stations and previously undisclosed 

subvendors to determine CHGO's media spending." 

" The Supreme Court has recognized that the so-called "magic words" test derived from Buckley v. Valeo, 424 U.S. 

1,44 n.52 (1976), is "functionally meaningless." McConnell v. FEC, 540 U.S. 93, 193 (2003). 

" See Third General Counsel's Report at 19. 

'* See Letter from Jeff S. Jordan, Supervisory Attorney of Complaints Examination & Legal Administration, Office 

of General Counsel to William B. Canfield of Commission on Hope, Growth & Opportunity, MUR 6391 (Oct. 15, 

2010); Letter from Jeff S. Jordan, Supervisory Attorney of Complaints Examination & Legal Administration, Office 

of General Counsel to William B. Canfield of Commission on Hope to William B. Canfield of Commission on Hope 

Growth & Opportunity, Growth & Opportunity, MUR 6471 (May 26,2011) (notifying respondent of "a legal 

obligation to preserve all documents, records and materials relating to the subject matter of the complaint until such 

time as you are notified that the Commission has closed its file in this matter"). See also Letter from Lee E. 

Goodman, Chair to William B. Canfield of Commission on Hope, Growth & Opportunity, MUR 6391 & 6471 (Sept. 

30, 2014) (notifying respondent of the obligation to preserve all documents, records and materials after the 

Commission found reason to believe CHGO violated the Act). 

" Second General Counsel's Report at 7, n. 20. An April 6,2012 e-mail between CHGO leaders suggested that 

CHGO be terminated "most quickly," because "[tjhere is an outstanding matter at the Federal Elections [sic] 

Page 4 of 5 
MURs 6391 & 6471 (Commission on Hope, Growth & Opportunity) 

Statement of Chair Ravel and Commissioner Weintraub 

We have a responsibility to Congress, the courts, and, most importantly, the American 

people, to enforce the laws as they exist, not as we would like them to be. The Commission is 

falling far short of that responsibility. The law in this case clearly requires the Commission to 

conclude that CHGO is a political committee and therefore must disclose its contributors and 

spending. The failure to enforce the law against a group that so clearly flouted all disclosure 

requirements is unreasonable and inexcusable. 

i\ls T 

Date Ann M. RaveT" 

Chair 

Ellen L. Weintraub 

Commissioner 

Commission and my sense is that we ought to shut it down to make things less complicated moving forward." 

Response of James D. Warring to Order to Submit Answers to Questions and Subpoena to Produce Documents 

(June 29,2015) at FEC-48I; Response of Susi Cedillo to Order to Submit Answers to Questions and Subpoena to 

Produce Documents (July 6,2015) at FEC-21. 

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